Wednesday, October 4th 2023
NVIDIA Reportedly in Talks to Lease Data Center Space for its own Cloud Service
The recent development of AI models that are more capable than ever has led to a massive demand for hardware infrastructure that powers them. As the dominant player in the industry with its GPU and CPU-GPU solutions, NVIDIA has reportedly discussed leasing data center space to power its own cloud service for these AI applications. Called NVIDIA Cloud DGX, it will reportedly put the company right up against its clients, which are cloud service providers (CSPs) as well. Companies like Microsoft Azure, Amazon AWS, Google Cloud, and Oracle actively acquire NVIDIA GPUs to power their GPU-accelerated cloud instances. According to the report, this has been developing for a few years.
Additionally, it is worth noting that NVIDIA already owns parts for its potential data center infrastructure. This includes NVIDIA DGX and HGX units, which can just be interconnected in a data center, with cloud provisioning so developers can access NVIDIA's instances. A great benefit that would attract the end-user is that NVIDIA could potentially lower the price point of its offerings, as they are acquiring GPUs for much less compared to the CSPs that receive them with a profit margin that NVIDIA imposes. This can attract potential customers, leaving hyperscalers like Amazon, Microsoft, and Google without a moat in the cloud game. Of course, until this project is official, we should take this information with a grain of salt.
Source:
CNBC
Additionally, it is worth noting that NVIDIA already owns parts for its potential data center infrastructure. This includes NVIDIA DGX and HGX units, which can just be interconnected in a data center, with cloud provisioning so developers can access NVIDIA's instances. A great benefit that would attract the end-user is that NVIDIA could potentially lower the price point of its offerings, as they are acquiring GPUs for much less compared to the CSPs that receive them with a profit margin that NVIDIA imposes. This can attract potential customers, leaving hyperscalers like Amazon, Microsoft, and Google without a moat in the cloud game. Of course, until this project is official, we should take this information with a grain of salt.
12 Comments on NVIDIA Reportedly in Talks to Lease Data Center Space for its own Cloud Service
The concern there of course, is NVIDIA becoming a monopoly on cloud GPU computing, which honestly... is kinda the case already? So not much of a change, really, excepot it would be formalised.
It's obvious that it has the largest share of the GPU market, but is Nvidia using ARM cores a superior solution to monstrosities like the Mi300?
I really doubt it. But anyway, the main point is that Nvidia will compete with its own partners who buy its products in high volume. Hmm Yeah, I think Huang is arrogant enough to shoot himself in the foot like that eventually.
Asic solutions such as those created by Tesla, Meta, Google etc... Nvidia's ecosystem is not necessary in most cases, current demand leaves room for competition.
If Demand exceeds production capacity, the market tends to absorb all the products it finds on the market. Microsoft's words, not mine.
And Tesla are still using 10,000 NVIDIA GPUs anyway.